Clarington Corp. has found a friendly bidder with deeper pockets. The fund management firm announced today that Industrial Alliance Insurance and Financial Services Inc. will make a $273 million cash offer for all the issued and outstanding common shares of Clarington.

Industrial Alliance will offer Clarington shareholders $14.25 per share.

That easily exceeds a takeover bid launched by CI Financial last week. CI said it would offer Clarington shareholders $13 a share, for total consideration of approximately $254 million.

Clarington announced today that its board of directors of Clarington has unanimously approved the proposed transaction and will recommend that its shareholders accept the offer.

Blair Franklin Capital Partners provided the independent special committee of the Clarington board with their opinion that the consideration under the offer is fair from a financial point of view to the holders of Clarington common shares.

“In Industrial Alliance, Clarington has found an exceptional partner to continue the strong sales and asset growth that has long been a hallmark of our company,” said Terence Stone, chairman of Clarington Corp., in a release.

“We are very pleased with this transaction, which is the natural extension of our wealth management growth strategy,” said Yvon Charest, president and CEO of Industrial Alliance.” Together, Industrial Alliance and Clarington will have the scale to compete as a strong player in the increasingly concentrated retail fund marketplace. With over $10 billion of retail funds under management, the combined investment management operations will have over 500,000 clients and the size to provide value to shareholders and unitholders alike.”

Clarington shareholders will be offered $14.25 per Clarington share in cash or Industrial Alliance common shares at their option.

The cash option is not subject to limitation or pro-ration, however, the Industrial Alliance share option is subject to pro-ration based upon a maximum of 25% of the purchase price.

The share exchange ratio used to calculate the number of Industrial Alliance common shares issuable will be based upon the volume weighted average closing price of Industrial Alliance over the five business days ending one business day before the expiry of the bid.

The offer will be subject to certain conditions, including acceptance of the offer by holders of at least 66 2/3% of the outstanding common shares of Clarington, and receipt of all required regulatory approvals.

Full details of the offer will be included in the formal take-over bid circular and related documents, which will be mailed to all shareholders of Clarington no later than November 21.

As evidence of their support of the transaction, certain shareholders, representing approximately 25% of the issued and outstanding shares of Clarington on, have agreed to tender their shares and have entered into lock-up agreements with Industrial Alliance.